Rieger Report® ETF Face Off: Passive or Active?

ETF Face Off:  Passive or Active?

This report compares head to head two municipal bond ETFs, two intermediate municipal bond ETFs and two U.S. Mortgage Backed Securities ETFs. Selected for comparison were leading passively managed ETFs and actively managed competitors.

  • Municipal bond ETFs: iShares National Municipal Bond ETF MUB (Passively managed) v. IQ MacKay Shields Municipal Insured ETF MMIN (Actively managed). Advantage: MMIN
  • Intermediate term municipal bond ETFs: Van Eck Vectors Intermediate AMT-Free Municipal Bond ETF ITM v. IQ MacKay Shields Municipal Intermediate ETF MMIT (Actively managed). Advantage: ITM
  • U.S. MBS ETFs: iShares MBS ETF MBB (Passively managed) v. Janus Henderson Mortgage Backed Securities ETF JMBS (Actively managed). Advantage: JMBS

Municipal ETFs: MUB v. MMIN

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Sources: iShares.com, NYLinvestments.com and Yahoo.com. Table is provided for illustrative purposes only. Past performance is not a guarantee of future results. Data as of 12/9/2019 unless otherwise noted. (1) Data as of 11/302019.

Municipal ETFs Face Off: MUB v. MMIN 

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Advantage: While MUB has a lower management fee, higher liquidity, hedging capability and transparency, IQ MacKay Shields MMIN has executed well, is opportunistic and follows the insured muni segment and as a result has the advantage in my opinion.

Intermediate Municipal ETFs: ITM v. MMIT

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Sources: VanEck.com, NYLinvestments.com and Yahoo.com. Table is provided for illustrative purposes only. Past performance is not a guarantee of future results. Data as of 12/9/2019 unless otherwise noted. (1) Data as of 11/302019.

Intermediate Municipal ETFs Face OffITM v. MMIT

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Advantage: Van Eck’s ITM due to performance, management fee, liquidity, hedging capability and transparency offered.

Mortgage Backed Securities ETF MBB v. JMBS Vital Statistics

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Sources: iShares.com and JanusHenderson.com. Table is provided for illustrative purposes only. Past performance is not a guarantee of future results. Data as of 12/4/2019 unless otherwise noted. (1) Data as of 10/31/2019.

Mortgage Backed Securities ETF Face Off: MBB v. JMBS

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Advantage: Very close, but Janus Henderson’s JMBS ETF has the ability to be opportunistic in its bond selection and that ability has resulted in higher year-to-date returns. MBB is ideal for low cost “beta” exposure.

Analyst Disclosures

  • At the time of this writing, JR Rieger owns individual municipal bonds and a municipal bond fund.
  • JR owns, actively looks for and attempts to buy insured municipal bonds.
  • JR does not own any of the ETFs identified in this report.

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